Bangkok Bank (BBL) has emerged as the only Thai bank to join the Voltron project with the R3 consortium to develop a letter of credit (L/C) service using blockchain technology to increase transaction efficiency.
The L/C service using the R3 Corda distributed ledger technology (DLT) will increase efficiency and reduce transaction processing times, starting from requests by importers to issue an L/C up until an exporter receives payment, said BBL executive vice-president Ian Guy Gillard.
Business customers will be able to reduce working processes in their companies and arrange transactions with trade partners and banks more easily, he said.
Bangkok Bank, together with R3 and its partners, co-launched the Voltron project in Australia at the end of October.
The financial service in the international trade system, using blockchain technology, aims to revolutionise the entire international trade process and mark a step forward for banks and international trade customers.
In addition to the Voltron project, BBL is working with the R3 consortium to develop its international trade service using Corda on Marco Polo, which is developing an open account trade finance service.
"We're confident about our partnership with the R3 consortium, as the developer has in-depth knowledge and understanding of international trade finance in terms of business and technology," Mr Gillard said. "R3's Corda DLT platform is designed to provide high data security, and transactions will only be accessed by specified parties, which is different from other DLT services. Bangkok Bank believes that the developed L/C services will be able to meet the needs of its customers."
Pornnit Dunnvatanachit, executive vice-president and shared operations manager, said the development of L/C services using Corda technology is an important step for the bank in supporting international trade transactions.
Customers can quickly and easily perform L/C transactions in real time. Business partners or organisations involved in the same trade transaction can see data simultaneously and provide transparency, verifiability and high security, enabling customers to manage their transactions more effectively.
The collaboration between BBL and global trade finance banks providing real-time transactions under Corda technology will facilitate customers' trade with business partners around the globe.
The service is expected to be well received by export and import customers.
"The development of new-generation L/C will reinforce BBL's commitment to continue our service development as a trusted partner and international trade expert ready to help our customers succeed in the global trade arena," Mrs Pornnit said.
BBL shares closed on Thursday on the Stock Exchange of Thailand at 209 baht, up three baht, in trade worth 793 million baht.